While the thought of dealing with is enough to scare off many would-be rental property owners, buying investment real estate can be a great business move.
You’ll get rental income, enjoy property valuation increases, diversify your investment portfolio, and eventually hit the jackpot by selling your property for a tidy profit. So, if you have the financial capacity to buy a rental property, it’s a move worth considering.
Consider these six reasons to buy an investment property. You’ll also see why your experience as a rental property owner can go a lot better if you hire the right property manager.
1. Diversify Your Investments
Placing all your eggs in one basket is never a good idea. So, if you invest in a high-interest savings account, the stock market, mutual funds, and index funds, consider rental properties. Yes, there’s a higher cost to invest in real estate. But if you have the financial means and the desire to have another proverbial basket to build wealth, consider getting into the rental property space.
Owning and operating an investment property can be overwhelming. That’s why some property owners hire property management firms. Find one close to where your rental property is.
If you own a duplex rental unit in Houston, pursue .
2. Enjoy Monthly Rental Income
Another reason to consider joining the ranks of rental property owners is the chance to make passive income every month. If you price the rent appropriately, your tenants’ rent will cover the monthly mortgage and leave you something on top of that to spend or save as you will.
Of course, you need the right tenants if you’re going to succeed as an investment property owner. That steady flow of monthly will only be possible if tenants pay rent. That’s another reason to consider hiring a property manager. Property management service providers can screen applicants so that you get the most promising tenants — and they can collect rent.
So, the right property manager can make your rental property ownership experience easier.
3. Give Yourself Options
Yet another reason to consider buying an investment property is that you’ll have more options. If you’re nearing retirement, you can move into your rental property. You can also move in if you lose your job or want to downsize. You also have the option to monetize your investment to take advantage of the property value increase. That’ll be possible.
4. You Can Build Generational Wealth
Are you thinking ahead? If so, you might want to . One way to build a solid financial foundation upon which your kids can build is through a rental property portfolio. You can set your offspring up for success by investing in real estate.
5. You Can Enjoy Tax Benefits
Tax benefits also come with buying investment properties. You can claim many of the investment property expenses. Being able to deduct costs related to maintenance, mortgage interest, repairs, and insurance will come in handy during tax time.
6. You’ll Have More Control Over Your Asset
Buying a rental property will give you more control over your assets than you will typically get with other investments. You can have more control over who you rent to, which property manager you hire, and other things that directly impact your investment.
These are six reasons why buying rental units can be a sound decision for investment-minded people. Investment property ownership isn’t for everyone. For one thing, you may have to invest six figures or more for one. But if you want to build a solid financial foundation and diversify your investments, investment real estate is worth considering.